The community college recently formalized a longstanding policy of granting its lowest tuition rates to anyone who has graduated from a Montgomery County high school in the past three years. It does not require proof of legal residency.

A lawsuit filed on behalf of county taxpayers this week claims the policy violates federal and state laws that disallow various benefits for illegal aliens.

Supporters of the college’s policy say there’s no good basis for the lawsuit. Helping undocumented high school graduates afford higher education, they say, provides both social and economic benefits to the county.

The federal DREAM Act, which didn’t make it to the finish line in Congress last year, would have created a path to citizenship for students brought to the United States illegally as minors if they met certain criteria. Instead, such students are subject to a wide variety of state laws on enrollment and tuition at public colleges.

Three states ban in-state tuition for such students – Arizona, Colorado, and Georgia. And South Carolina bans illegal immigrants from enrolling altogether at public colleges and universities.

In a typical year, 30 to 50 bills on either side of the tuition issue are introduced in the states, says Brenda Bautsch, an NCSL education-policy specialist in Denver.

Already this year, lawmakers in California, Nebraska, and Oklahoma have launched efforts to repeal tuition-break laws.

In Maryland, lawmakers have been squaring off. Democratic state Sens. Victor Ramirez and Richard Madaleno are proposing to make some undocumented students eligible for tuition benefits. Republican Patrick McDonough, a Maryland state delegate who encouraged the suit against Montgomery College, is proposing ways to tighten immigration enforcement.

The lawsuit against Montgomery College “is a political maneuver to flare tensions around the topic of immigration, and it has really struck a chord,” says Rosa Lozano, a graduate of the college and a youth organizer who supports the DREAM Act. She hopes the lawsuit will just “push people who felt they were neutral to really stand in support of in-state tuition this year.”

Even without broader measures that would help these students pursue careers once they graduate, she says, access to college is important because “young people who see that they have a future are less likely to fall into the pitfalls of teen pregnancy, drug abuse, or gang violence.”

But opponents of tuition benefits see it differently. Such benefits are part of a broader problem of states and institutions “putting giant welcome signs over their communities” for illegal immigrants, says Tom Fitton, president of Judicial Watch, a conservative watchdog group that filed the Montgomery lawsuit on behalf of several local taxpayers.

The lawsuit, filed Jan. 20 in the Circuit Court for Montgomery County, alleges that by granting in-county tuition rates to students who do not show legal residency, the college lost $5.8 million dollars it should have collected from those students between 2006 and 2009 – money that could have been used to offset state and county taxpayer expenditures.

In a statement this week, Montgomery College countered that the complaint “contains various misrepresentations about College operations and misapplications of law.” The college, which has multiple campuses where about 60,000 students are enrolled a year, defended itself as a contributor to the local economy, not a drain on it.

A 1996 federal immigration law says illegal aliens cannot gain higher-education benefits “on the basis of residence” unless such benefits are also extended to US citizens. States that have passed tuition-benefits laws say they are based on high school attendance or graduation, not residence. Opponents of such laws say that’s a de facto form of residency and therefore violate the federal law.

A recent California Supreme Courtruling upheld California’s in-state tuition benefit for undocumented students. Although other state courts could rule differently, it’s the highest-level court decision on the issue so far. “It could give more confidence to states instituting such laws,” says Ms. Bautsch of NCSL.